Chinese private-sector refiner Shenghong Petrochemical plans to launch the 320,000 b/d crude distillation unit (CDU) at its Lianyungang refinery in Jiangsu province in May, according to market participants.
The 320,000 b/d CDU, with the largest capacity in Asia, is estimated to produce 64,822 b/d of gasoline, 10,219 b/d of diesel and 36,701 b/d of jet fuel at full capacity, with other units expected to start up gradually afterwards. The CDU is expected to take in several tens of thousands of tonnes of crude as feedstock, with output expected to be largely available to the market in August at the earliest, a refiner in east China said.
The Covid-19 pandemic will continue to pose a challenge to Shenghong's operations, as production could be suspended if any Covid-19 cases are found among their workers, a source close to the refiner said. Manufacturers in Lianyungang city will resume production after the Covid-19 outbreak in March, although the city still remains under tight pandemic control measures. Flights departing the city are currently suspended, and only some flights can resume from 10 May. Visitors from outside the city may face quarantine at home, while cities with high Covid-19 cases, like Beijing, will require visitors to undergo quarantine at specific facilities identified by the government. Logistic and personnel arrangements could also face disruptions because of Covid-19-related restrictions.
The refinery was expected to come on stream in March. But the start date was delayed as crude future prices spiked to multi-year highs, preventing the refinery from building sufficient crude stocks for long-term operations.
